2019 (8) TMI 1461 - AT - Income Tax

Levy of fee under section 234E - processing the TDS statement u/s 200A - difference of opinion between the members constituting the Bench - HELD THAT - While deciding the issue there was a difference of opinion between the members constituting the Bench. While the Accountant Member held that the provision of section 200A(1)(c) will apply retrospectively the Judicial Member held that levy of fee under section 200A(1)(c) would apply prospectively to any period falling after 1st June 2015. While deciding the issue the Third Member agreed with the view expressed by the Judicial Member and held that fee under section 234E of the Act can only be charged in respect of delay in filing the statement of TDS for the period after 1st June 2015. Thus as per the majority view appeals are allowed for statistical purposes. Assessee s appeals are allowed for statistical purposes.

Summary

Issues:
Challenge to levy of fee under section 234E of the Income Tax Act, 1961 for TDS statements prior to 1st June 2015.

Analysis:
The appeals were against a common order regarding the levy of fee under section 234E of the Income Tax Act, 1961 while processing TDS statements. The provision for this fee was introduced with the insertion of sub-clause (c) to sub-section (1) by the Finance Act, 2015, effective from 1st June 2015. The main contention was whether this provision applied retrospectively or prospectively. The Accountant Member believed it applied retrospectively, while the Judicial Member opined it applied prospectively post 1st June 2015. Due to this difference, the issue was referred to the Third Member. The Third Member framed the question of whether the fee under section 234E could be levied for periods before 1st June 2015 when there was no decision by the jurisdictional High Court and conflicting views from other High Courts.

The Third Member, concurring with the Judicial Member, held that the fee under section 234E could only be imposed for delays in filing TDS statements after 1st June 2015. Consequently, the appeals were allowed for statistical purposes, indicating that the fee could not be charged for periods preceding the specified date. The decision was pronounced in open court on 28th August 2019.